April 26,
2018 "Information
Clearing House" -The Turkish government has
made the decision to repatriate all of its
gold reserves that are currently housed in
the US Federal Reserve System (FRS). Overall
Turkey was storing 220
tonnes, valued at $25.3 billion,
in the US, which it repossessed on April 19,
2018.

Turkey’s
President Recep Tayyip Erdogan has
toughened his stance against the
US dollar (USD), declaring that
international loans should be made in gold
instead of the American currency. Ankara is
seeking to reduce dependence on the US
financial system. The gold’s homecoming was
partly prompted by the US threats to impose
sanctions if Turkey goes through with the
signed deal to purchase Russian S-400
missile defense systems.

This is a
dramatic move reflecting an international
trend. Venezuela repatriated its
gold from the US in 2012. In 2014, the
Netherlands also retrieved its 122.5 tonnes
of gold that were stored in US vaults.
Germany brought
home300 metric tonnes of gold
stashed in the United States in 2017. It
took Berlin four years to complete the
transfers. Austria and Belgiumhave
reviewedthe possibility of
taking similar measures.

Few people
believe the US Treasury’s assurances that
the 261 million ounces (roughly 8,100 tonnes)
in official gold reserves that are stored in
Fort Knox and other places are fully audited
and accounted for. The Federal Reserve has
never been fully and independently audited.
The pressure for a full, independent audit
of all US gold reserves has always been
resisted by the government and in Congress. Nobody
knowsif the gold is really
there. What if the vaults turn
out to be empty? It’s wiser to
bring your gold home while you can, rather
than to just keep on wondering.

The gold bars
that the US claims to hold are of low purity
and do
not conform to international
industry standards. Even if the US has the
amount of gold it claims to have, most of
it would
not be acceptable for tradingon
the international market. While other
countries are pulling their gold out of the
FRS banks, Russia and China are boosting
their reserves, creating
gold-backed currencies for themselves and
thus moving the world away from the
dominance of the USD.

The US
dollar’s status as the
global reserve currency has been called into
question. It faces some tough
competition. The tariffs
introduced by the US administration as an
instrument of coercion against other
countries are failing to bolster the
greenback, which may soon face headwinds. An
international currency war looms
as a
possibility. This makes investors look
for other options. Indeed, why should
other countries rely on a US dollar that is
not backed by gold or anything but “the good
faith and credit of the American worker,”
when America itself is
not trusted internationally?

For instance,
the Chinese yuan is
going strong. Russia, Turkey, and
Iran are
considering the prospects for making
payments in their national currencies. Iran
has recently announced it is switching from
the dollar to the euro as its official
reporting currency. Russia and China have a
currency swap agreement that avoids
settlements in the USD.

The quest to
reduce dependence on the dollar was provoked
by the ongoing use of sanctions as a
political weapon, a kind of foreign-policy
tool of choice. Even America's closest
allies are threatened by these restrictive
measures. The recent
attack on the Nord Stream 2 gas
project is a good example. It’s only natural
for other countries to be looking for ways
to resist the US policy
of twisting arms.

Using alternative currencies and bringing
gold home are ways to do that.

America has
always opposed such efforts. Any methods
would do. Muammar Gaddafi, the Libyan
leader, was toppled and killed after he came
up with the idea to introduce a golden dinar
to be used as an international currency in
the Middle East and Africa. Iran has
recently banned the
use of the USD in trade. It refuses to sell
its oil for the US currency. President Trump
is likely to kill the Iran deal in May,
provoking Tehran into reviving its nuclear
program.

An armed
conflict with Iran might be much
closer than generally believed.
The nuclear deal has been honored, to
everyone’s satisfaction but to Washington’s
chagrin. Iran undoubtedly has no military
capability that would be a threat to the US.
It has never been responsible for any
terrorist acts committed abroad or things
like that. But it has done something
unforgivable in the eyes of the US. It has
threatened the USD. That’s what Washington
cannot accept, because if it does not
support the dollar, there will be problems
financing the US government’s huge federal debt.
A war with Iran would eliminate the
largest non-USD oil exporter. One thing
leads to another. The gold repatriations are
a precursor to a currency war and armed
conflict. That’s what drives US foreign
policy.

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